Red Cross = Red Tape

I keep getting stories from people who have problems with the Red Cross. Everyone sees the stories of the FEMA and Red Cross monies spent at strip clubs and designer malls. The criminals and reckless folks have figured out how to milk the system better than the honest people. Many people I speak with feel guilty for taking the money since they are in financial positions where they do not currently need it. I think this is the one time you should take it. Regardless of how much insurance you have, you are going to lose money on this situation. This is like an insurance claim, you may never need it again and this is what you pay the premiums for all your life. If you really feel guilty take the money and donate it to a charity of choice.

One friend of mine was blown away by the hospitality of a small resort community that runs a small hotel on the premises. They already reasonable rate of $50/night was reduced to $35/night once the news of Katrina spread and they realized that many of their visitors were evacuees. [Note 1: people who leave on their own prior to the storm are evacuees vs. refugees]. Imagine how great he felt when he learned that many of his work colleagues paid nothing for somewhat nicer digs in Houston. Again, punishing the honest.

Once he returned to his unflooded home, anger set in and he decided he wanted a piece of the government cheese. Plagued with visions of 8 hour lines waiting for Red Cross assistance, he thought he would outsmart the system and dial the 800 number. Unfortunately the 800 number has about the same hit rate as the average Baton Rouge phone number when being called from out of state. Occasionally, it would actually answer with a "this line is for evacuees only" and some gibberish about the phones being "overwhelmed". [Note 2: Katrina is not the first hurricane to hit the US. See hurricane Ivan 2004] I understand that Baton Rouge can't handle the call volume but FEMA is used to massive amounts of people calling after a disaster. The recording tells you to check the Red Cross website for additional assistance options. Instead of putting you back on hold, it puts you into a fast busy situation and you are toast. [Note 3: Some evacuees may be on a pay phone and not have access to the internet]

I wish the idiocy ended there. You can file for something called "disaster unemployment". If you file you will get a letter telling you to expect a pre-loaded debit card with the benefit money on it in just 21 days. The beauty of the letter is that it generally arrives the same day as the benefit card. This reminds me of the first Bush tax refund where you received a letter telling you that a check would be immanent (at the cost of the tax payers). You then need to call an 800 number to activate the card and establish a PIN and finally learn of the balance. You can also do the transaction via the web and get the details of the transactions that went into creating your amount. The beauty of the web is that the login doesn't work. This has been tried with IE, Firefox and others (no anti-MSFT bigots please) with pop-ups and cookies enabled and disabled. There is a JavaScript popup that states "I'm sorry, I don't recognize the information you entered". Of course this occurs after you have entered the card number, PIN and agreed to something or other. I have to sympathize with this dilemma, as we filed a FEMA claim (to be discussed in a future post) and it kept coming up with a "can not verify your identity" after entering pages of information. It turns out that it could not recognize "W Street Name" vs. "West Street Name". I wish the government would follow the standards that they themselves try to establish.

When the friend finally got through to the Red Cross, he was denied an benefits. If he had gotten through a week earlier, he would have gotten assistance on the evacuation and living expenses. Now the deal is "only if your pre-storm residence is currently uninhabitable". The moral of the story is to file early and often. When he griped about the lack of info on the website, he was told that if it was published people would call and lie about their situations. Sounds like the magic formulas for FICO scores. Not bad for being on hold for an hour and a half.

One other business associate who lost everything got the standard $2,000 up front. He applied for additional living expenses. He was denied. Why? Too much income? Too much insurance? No - he did not return the required form within the 14-day time limit. Turns out he never received the form due to mail delays. Once he debugged the problem he was told to write up an appeal letter and fax it back to FEMA. This person lives in Slidell. Try finding a working fax machine that has a good phone line. Now try to get through a number that has been given out to hundreds of thousands of disaster affected citizens. This really is a disaster.